TAX CREDIT FOR BUSINESSES THROUGH THE ALABAMA ACCOUNTABILITY ACT

Please see this example from Scholarship for Kids of how this donation can be a business expense AND a state tax credit:

HERE ARE THE 4 STEPS TO RESERVING YOUR CREDIT AND MAKING THE PAYMENTS:

1. Create an account at myalabamataxes.alabama.gov if you don’t already have an account.
2. Reserve your desired credit amount on your My Alabama Taxes account. It is important to note that there is an annual limit of $40,000,000 on the total amount available for reserve. In other words, the credit could potentially “run out” if you wait to reserve your credit.
3. Once you have reserved your credit, you or your company can contribute to the Scholarship Granting Organization of your choice. For a list of approved organizations visit this link.
4. Keep your receipt of donation from that organization for tax return preparation purposes to give to your accountant and to keep for your records.

For further guidance on steps 1 and 2, visit this link.